The JC Penney stock (JCP) ended Friday’s session with a bullish hammer candlestick accompanied by a nice pickup in volume, which could mean a reversal indication. I think we have reached the bottom in short-term. Price hit a high of $3.62, which is resistance for Monday’s continuation move. I will add few more shares once it breaks through this high and expect to see heavy volume push the stock higher.
Despite weak signal from daily MACD in the technical chart as MACD and signal line are below 0, the technical indicator RSI is starting to turn up, making a higher low supporting a potential bounce from these levels. The price may rise to the 3.82-4 range in the short-term, so keep the stock on your radar for next week.
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This is a guest post by António Costa, acclaimed trader and the popular author of AC Investor Blog. All views and analysis belong to the author.